As well as improving health, reducing road deaths and increasing retail sales, the investment should ameliorate the high level of air pollution in the UK and lessen the impact of travel on the environment.

Nick Clegg said: "The rewards could be massive. Billions of pounds in savings for the NHS, less pollution and congestion, and a happier and safer population.

"In government, we're putting the money down: now we need the public and local authorities to jump on their bikes and get us to the finish line."

As well as the investment, Clegg will launch two initiatives to help encourage children to take up cycling: a scheme from Halfords to recondition and donate bikes and helmets to disadvantaged children; and a pilot scheme to expand the Bikeability cycle training programme.

Olympic gold medallist Chris Boardman MBE, who attended the summit, said: "The next step, building on today's announcement, is to make investment like this one a permanent, embedded and an ongoing part of our transport strategy. If we do, then the benefits for our nation's health, wealth and environment will be monumental."